What is the cost of a rooftop solar PV system?

There are two major factors on which the cost of solar rooftop systems depends. These are:

1. Incentives/subsidies available.
2. Function it serves.

Before coming to the cost of the rooftop solar systems, first we must have a brief idea about the different kinds of rooftop solar systems. Rooftop solar systems are divided into 3 types:

• Grid-tied: This kind of system is designed to power the load as well as to supply the generated power to the grid. These rooftop systems do not work during power failure.
• Grid-interactive: They are grid tied systems but can work well during a power failure as they have either diesel generator or battery backup to support the load.
• Off-grid: They can only work with either the diesel generator or the battery backup; they do not work in grids.

Cost of the solar rooftop systems contains the cost of all the components it is made up of.

Without including incentives and batteries, a solar rooftop system costs around 1,00,000 rupees per kWp (kilowatt peak) including installation charges. Below we have shown a usual cost breakup for 1 kWp system:

Component

Rupees

% of Total Cost

Invertors

23,000

23%

PV modules

52,000

52%

Installations

8,000

8%

Balance of systems

17,000

17%

Total

1,00,000

Note: Here we have not considered battery backup and thin-film modules as they require more installation area.

Incentives/Subsidies

The Jawaharlal Nehru National Solar Mission states that there are several subsidies or incentives available for solar rooftop systems.

1. Accelerated Depreciation (AD): For rooftop solar systems under the Income Tax Act, there is accelerated depreciation available of about 80%.
2. MNRE subsidy: Depending on the nature of the applicant, the Ministry of New and Renewable Energy gives central financial assistance by giving capital/interest subsidy.

Final cost of the Solar Rooftop after considering Accelerated Depreciation and Subsidy benefit is discussed below:

(A usual breakdown of the final cost of 1 kW rooftop solar systems)

• Cost of a 1 kW rooftop solar plant: 100,000/-
• Subsidy @ 30%: 30,000/-
• Net cost after subsidy: 70,000/-
• Accelerated depreciation @80%: 56,000/-
• Tax rate: 35%
• Net cost after both AD and Subsidy: 50,400/-

So we can say that there are many factors on which the cost of Rooftop systems depends. Some of them are brands, warranties, overstatement of capacity and certifications/standards.

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